The latest CYSTAT figures show tourist arrivals for the year 2026 up to April down 27.6% compared to the same period in 2025. The regional instability in the Middle East has directly affected nearby markets especially Israel, which dropped by 74.8% while our traditionally primary market, UK, saw a decrease of 21.8%.
Further to the declining numbers, local industry organisations (like STEK and ACTA) are pointing to a much tougher operational impact: a reduction in airline seat capacity, higher ticket prices, and a heavy reliance on ultra-last-minute bookings.
Essentially, the historical playbook for forecasting hotel occupancy has been disrupted due to the political uncertainty in the region.
This reality was touched upon during our recent Baker Tilly South East Europe 30th Anniversary Event. A key takeaway from the macroeconomic discussions was clear: volatility is our new normal, cheap money is gone, and cost pressures are structural, not temporary.
To turn resilience into a genuine competitive advantage this season, hotel management teams need to shift focus toward a few practical financial priorities:
- Real-time scenario planning to cover demand shocks.
- Liquidity monitoring – protecting working capital and extending funding maturities to cushion against short-term occupancy swings.
- Accelerate productivity investments – investing in AI and automation to offset structural labor shortages and rising overheads.
- Geographic diversification – actively exploring alternative target markets to balance out weakness in traditional ones.
At Baker Tilly, our audit and advisory teams work alongside hotel operators to build the flexible financial stradegies required to navigate these chalenges smoothly.
If you would like our support or to explore our tailored solutions, please contact our Retail Consumer and Hospitality Leader, Stela Ivancheva, Partner at Baker Tilly Cyprus, at: s.ivancheva@bakertilly.com.cy






